Question
Mr. A had funds in an overseas account in dollars. Mr. B borrowed the dollars from A to pay back to A in A's home country which is South Africa in Rands. What currency rate must B use to pay the loan back, the rate the day the loan was taken on or the rate the day the loan is being paid back?
Answer
B should pay the amount/ value of the gold which the dollars could procure on the day he acquired the dollar loan. For example, if the day he acquired the loan, the dollars could purchase 2 krugerrands, then whenever he repays the loan he must pay two krugerrands or its current value.
- Source
- themajlis.co.za
- Published in
- The Majlis Vol 28 No 11
- PDF page
- 5